SM’s stock price fell after aespa’s Karina’s dating news
aespa's Karina and actor Lee Jae-wook confirmed their relationship. However, on the day this news broke, Karina's agency SM Entertainment saw its stock price drop by more than 3%
On this day, on the KOSDAQ market, SM Entertainment’s stock price recorded a 3.47% drop to 77,900 won. It was the lowest level since closing at 77,400 won on Feb 14th.
On this day, SM Entertainment stated regarding the relationship between the two, “They are getting to know each other.” Lee Jae-wook’s agency C-JeS also stated, “The two are getting to know each other, and since the actor is in the middle of filming and it is his private life, we ask you to treat him with warm eyes and respect.“
Previously, entertainment media outlet Dispatch reported that Karina and Lee Jae-wook have been dating secretly. They were known to have started dating after meeting at a fashion show in Milan last month. aespa is preparing to release their first full-length album in the second quarter of this year, while Lee Jae-wook, who gained fame through dramas like “Extraordinary You” and “Do Do Sol Sol La La Sol”, is set to appear in Disney+’s original series “The Impossible Heir”, which will be released on Feb 28th.
Meanwhile, Daishin Securities had previously lowered its target stock price for SM Entertainment from 160,000 won to 120,000 won, a 25% decrease, citing delays in the label expansion plans. Analyst Lim Su-jin said in a report, “The label expansion plans have been delayed in the medium to long term, making the timing of the anticipated full-scale entry into the Western market uncertain. A multiple downward regulation is inevitable.”
Furthermore, the poor performance of its subsidiary SM C&C and performance-related corporations due to a decrease in domestic and international concert sizes leading to operational losses also contributed to the negative evaluation. However, Analyst Lim maintained a positive view on the main business, “The main business is still positively evaluated. Regarding NCT Dream, who is scheduled to make a comeback in March, despite some fans moving to RIIZE’s fandom, the operational profit margin of low-year IP (album, streaming, goods, etc.) is high. The investment recommendation remains ‘buy’.“
On the other hand, with the forecast of a decrease in album and streaming sales in the first quarter of this year, the stock price of HYBE, the largest entertainment company in Korea, dropped by more than 7% on Feb 27th. On this day, on the KOSPI market, HYBE closed at 202,000 won, down 7.13% from the previous day.
Despite being the first entertainment company in Korea to surpass annual sales of 2 trillion won amid the absence of BTS’ team activities, the stock price fell due to the forecast of poor performance in the first quarter of this year. Analyst Lee Ki-hoon of Hana Securities said, “The earnings outlook remains the same, but due to a decrease in the album’s growth, the industry’s valuation has fallen, resulting in a 13% downward revision in the target P/E (price-earnings ratio).“
He added, “I expect HYBE’s album and streaming sales in the first quarter of this year to be 128 billion won. Album and streaming sales were 276 billion won in the fourth quarter of last year, and 184 billion won in the first quarter of last year. I expect they’ll make about 10 billion won in operating profit in the first quarter, but with the concentration of comebacks by major artists in the second quarter, I forecast an operating profit of around 110 billion won in the second quarter, the highest ever.”
Source: Nate
